Debt can be a vicious cycle, especially if you have bad credit. An unexpected emergency arises and you take on a high-interest loan because you simply have no other options. Because of that high interest and your financial difficulty, six months later you end up owing more than you originally borrowed. And the process repeats itself; meanwhile, you find yourself increasingly in debt.
If this sounds like you, the reality is that many lenders will not be willing to consider your loan application. But this isn’t always the case. Even if your credit history isn’t perfect, there are still lenders out there who are willing to help.
Thus, even if your credit history is less than perfect, it’s worth considering the loans below. If you are stuck in a never-ending debt cycle, these loans might be a much better alternative.
$500 - $5,000
3 to 60 months
Loans from BadCreditLoans’s network of lenders range from $500 to $5,000. However, they do note that lenders will not typically lend more than $1,000 to borrowers with bad credit. As with most personal installment loans, APR ranges from 5.99% to 35.99% and terms are from 90 days to 60 months.
In a similar vein, there are basic eligibility requirements all borrowers meet. These include being 18 years of age and a US citizen. But even if you meet those requirements, there is no guarantee a lender will approve you. The good news is that the application process is very simple; it only takes a few minutes.
Features and Benefits
- No obligation or fee to check loan approval
- High approval rate despite credit history
- Funds available as soon as next business day
- Assisting people with bad credit since 1998
$500 - $35,000
3 to 72 months
On PersonalLoans.com, you will find one of the widest arrays of lenders out there. Their network provides personal loans ranging from $1,000 up to $35,000. As with the other sites mentioned here, everything is done online. Peer-to-peer loans are also available.
Loan terms are from 90 days to 72 months. On other sites, you will find 60 months being the upper limit, but those sites usually offer smaller loans. You must be 18 years or older, be a US citizen, and have a Social Security number to apply. You also need a bank account and $2,000+ of verifiable income.
Features and Benefits
- Multiple loan types available
- Fast loan decision
- Funds deposited as soon as you accept an offer
- Nationwide availability
$500 - $10,000
3 to 72 months
As low as 5.99%
CashUSA offers potentially larger loans; amounts range from $500 to $10,000. As in most cases, though, those with poor credit ratings will probably not be approved for a loan of that size. However, the site stresses that those of all credit ratings are free to apply. You don’t have anything to lose other than a couple of minutes.
As the site’s name implies, loans here are cash loans, which allows you to remain anonymous and discreet. You might find that appealing if you don’t want friends and family to know about your financial struggles.
Once you fill out the eligibility form, you will potentially be connected with one of the lenders in CashUSA’s lending network.
Features and Benefits
- Flexible borrower requirements
- Loan request can be approved within minutes
- Money deposited as early as 1 business day
- All credit types accepted
Second-Chance Installment Personal Loans
Oftentimes, those who don’t have the best credit end up stuck with payday loans. These loans not only have extremely high interest rates but also require borrowers to repay them on or before their next payday (hence the name).
Installment loans are different. As their name also suggests, you repay the loan in monthly installments. The payments are often lower than lump-sum payday loans, and the interest rates are much lower as well.
To add to their benefits, making payments on time every month will bolster your credit history, meaning future loans will have more favorable terms for you.
Terms on these loans will usually run anywhere from 90 days to six years. In all cases, you will make one payment per month. Loan sums can be as little as $500 or as large as $40,000 in some cases.
That said, you probably won’t be approved for a $40,000 loan if your credit score is under 630. Similarly, your interest rate will likely be on the high end. Nevertheless, these installment loans are much better than payday loans, which average 400% interest.
Although installment loans are usually better than the alternative, some loan offers may not be the best. If you have a 60-month loan (5 years) and are being charged interest for 60 months, that can really add up.
And while pre-payment may be an option, many lenders charge pre-payment penalties. The idea is to discourage you from making early payments. After all, interest is how they make money on the loan. From the lender’s perspective, it makes sense, but it might be frustrating for you.
Best Short-Term Second-Chance Loans
Another option for second-chance loans are short-term loans. Technically, these loans are intended for different purposes than installment loans. While installment loans are meant for larger expenses, short-term loans are usually much smaller. They might be as low as $100 to help you pay for a medical bill. On the high end, these loans could grant you as much as $2,500.
Because short-term loans are intended for one-time expenses, you are expected to pay them off in a single payment. Interest rates on these loans tend to be high, but that also means those with low credit scores will have an easier time attaining approval.
The interest charged on short-term loans may seem small because the loan principal is usually small. But they also usually have just a two-week repayment period (since they correspond with your paycheck). If you had $25 of interest on a $200 loan that must be repaid in two weeks, the annual APR would be over 300%.
Up to $2,500
MoneyMutual is a lending network specializing in cash advance and short-term loans. Per their about page, they recognize the hardship so many Americans face on a daily basis. They connect you with the best lender to meet your needs so you don’t have to stress over finances.
If you meet the basic requirements for borrowers, you will be shown a list of possible lenders. The initial form only takes a few minutes. At that point, any lender with which you apply will also make a decision whether to approve or deny your application. Note that the state of NY residents are not eligible.
Loans on MoneyMutual can be up to $2,500. Terms and APR vary, but if approved, you could have your money as soon as the next business day.
Features and Benefits
- Fill out online form in less than 5 minutes
- Get a decision on your loan within minutes
- Loan deposited in little as 24 hours
- Trusted by more than 2,000,000 borrowers
$100 to $999
7 days to 12 months
CashAdvance.com offers small loans of $100 to $999. They welcome everyone to apply, regardless of your credit history. This makes sense given that these loans are smaller than those that some other sites offer. Despite this, loans from CashAdvance.com can still be useful. If you have a minor medical bill or car repair, these loans can cover some or all of the cost.
These loans are only available in certain states. If they are available in your state, you must meet the basic requirements. You must be 18 years of age and a citizen of the United States.
You should also be employed with an after-tax income of $1,000 or more. Lastly, you should be able to provide employment verification, have a home or work number, and have a valid checking account.
Features and Benefits
- Trusted since 1997
- Response by email or phone within minutes of submitting request
- Money deposited as soon as next business day
- High approval rate even with bad credit
Best Second-Chance Auto Loans
In addition to personal and short-term loans, it may also be possible to attain second-chance financing for a car. In many ways, lenders may be more willing to offer such financing. Thus far, we have mostly talked about unsecured loans, which can be difficult for a lender to recoup in the event you stop making payments.
An auto loan, on the other hand, is a secured loan. To be precise, the car itself secures the loan. That means that if you become delinquent on your payments, the lender can opt to repossess the vehicle. While one would hope such a thing never happens, it does make lenders more willing to lend to those with bad credit. Having this option means the lender will be more able to recoup their funds in such a situation.
From your perspective, not only will that make approval easier, but it may lower your interest rate as well. Interest rates are entirely based on perceived risk, and the possibility of repossession makes that risk lower.
A Second Chance at Financing Is Possible
If you have ever found yourself in a financial pickle after taking on financing, you might think no lender would ever consider you again. Fortunately, that isn’t always the case. There are lenders out there that understand that things happen. Sometimes things don’t go according to plan, but that doesn’t mean you shouldn’t be given another chance.
Of course, if you are looking for a second-chance loan, your interest rate will probably be a bit high. You also may not be approved for a very large loan. But you can flip the script by making your payments on-time and in full.
You Deserve a Second Chance (at Financing)
Although some of us may like to think we can never make mistakes, the reality is that they do happen sometimes. Sometimes those lives can affect our relationships, our mental health, and yes – our finances.
The good news is that even if you find your finances are suffering as a result of some missteps, chances are that all hope is not lost. There are many lenders out there willing to finance personal loans, short-term loans, and auto loans, even if it’s your second chance.
Because, as they say, we all deserve a second chance.